The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
http://fraser.stlouisfed.org/ ry Federal Reserve Bank of St. Louis -2It is perfectly safe to have tea if the water is boiled on the table where you can make sure that it really boils. With that exception, the only security against polluted water is to drink the well known brands of table water. In Japan, Tan San is the beat and can bs had everywhere. (4) Fish is the most dangerous food unless it is thoroughly cooked. It is a good carrier of cholera, but cholera, I believe, is practically unknown in the East except in the summer months. Nevertheless, it is well not to eat fish unless it is surely well cooked. The same precaution should be observed about uncooked vegetables such as one might have in salads. I would advise eating no lettuce, celery, radishes, etc., in the hotels, even the good hotels run by Europeans. but occasionally they are. These things are not very often served On the other hand, the precautions which are observed in private houses, and especially those of Uovernment oMcials, are such that there is no need for any precaution in regard to food. I have already explained the need for care about the bathing and toilet arrangements in native Lo eels in japan. Among the letters accompanying this memorandum, is one addressed to K. Nishi, c/o Miyako Ebtel, Kioto, gaben, who is an exceptionally fine courier for Japan. If the trip justifies engaging a separate courier, I can un- hesitatingly recommend him, and if he is engaged he will be pretty certain to get an excellent nan. It is possible, however, to get women couriers in Japan, although I think they are less dependable than the non. well to notify Nishi wall in advance. Time may not permit a visit to the monastaries at Koya. San. cemetery there is one of the most impressive things in Jsi,en. Tho The trip is not one of much hardship and cnn be made up a mountain of about 6,000 feat by rickshao. Should it be possible to make that trip it should be borne in Lind http://fraser.stlouisfed.org/ that Bank of St. stay in the Buddhist ,s.onastoixy, although one cnn sleep vox', Federal Reserveone mustLouis comfortably there as they will provide travellers with an ample supply of 411 bedding to rut on the floor. Strange to say, they will admit ladies as pilgrims, although it is a very remote place visited by comparatively few travellers, and a little preparation is required for the trip. The rules of the monastarit forbid them to cook or eat anything but vegetables, and the Japanese diet is sometimes a little difficult for the American palate. If the trip is made, I suggest taking a supply of eggs, coffee, evaoorated cream, butter and bread, and possibly some preserves or canned fruit, on which one can do very well for a ciF,1 or two. Nishi can do the cocking and will know exactly what to tale. A visit to Koya San implies that one will make an honorable contribution to the monastary where the traveller stops. This means poeFibly iOOyen apiece. The temple then puts a little tablet in the room where the morning service is conducted and the traveller can thereaft-er rely upon intercession for the security and happiness of his ancestors for a few thousand years hereafter. By all means stop at Shojo-Shin-In which is the best monastary. As a precaution I em sending a note of introduction to one of the priests there who is a hood friend of mine, and with when I correspond. Ea will show ::'re. Barney every possible attention. One word of caution about letters of introduction to official people. Many travellers carry letters of introduction to the, and it is a great convenience to them to receive information well in advance o he date of arrival which might be accompanied in advance by tho letter of introduction and advice of the name of the hotel where the traveller expects to stop. e us-171-1/2 FEDERAL RESERVE BANK OF NEW YORK (22C 7t1-1 7r;a- I .:1;_Vi'0,.1 71.7(2.1' t '3,77 - : o York 'I Geor-r, le-)Iner of 7111180.212hia are t I wonder if you Could not rearrarL'e t"_. 7uffrlo I ;r1?0 -ot ask it if I (lid not feel thot y-la ressaz-;e was a v or t' - neetinL. 'ave uot altton you earlier for the recEmi 1.-,t we in do-Tht until ton:- vbet'er the Carlrin I very 1r.,c_11 d stcrt in yo-1 will to plle 4,1 h-] Governor. us cut. eth. FEDERAL RESERVE BANK OF NEW YORK 1115 Fifth As..:Ittl: '111 "ST /2 ,412, 0,eJL-.7,z'f e 4-0 Y -G(/t./?e<>??9-=,1' -67se". gi174,-4, Hotel Ritz, London, September 8, 1919. Dear Tom: I am writing to advise you of my safe arrival in London, and also to thank you and Mrs. Felder for your many courte:lies to me while I wa© in Paris. It was a great pleasure to see sane old American friends. fit h every good wish, Sincerely yours, Thomas J. Felder, Esq., 114, Faubourg St. Honore, Paris. BS/V 1718 H Street, N. V., Waihineton, D. C. November 2, 1925. My dear Wills This is a quite personal, unofficial and confidential reply to your note of the 27th, because, in the absence of opportunity to talk the matter over with you on account of my absence from New Torbt, I must write you a very frank letter. The questions raised by the reports which you have sent me, and which I have read with great care, are partly questions of trade, competition, and profit, bell they are also partly questions which are essentially economic, and, in a sense, with the world in the condition which it now is, they ace almost moral questions. Disregarding for a moment the various arguments advanced in the report to Dr. Toune as to the methods adopted by the Berman Government to restrict the importatien of foreign films into Germany, the fundamental fact is that the producers of films in the United States desire to increase the sale of films in Germany because by doing so the profits of their business are enlarged. On the other hand, the effort of the German Government is directed by an absolute embargo, or limitation upon ioortation, to restrict the importation of films into Germany. The essential fact to be considered is whether the effort to restrict importation shall be effective or not, and whether the moral or economic grounds for the restriction are eounde Whether that restriction is imposed by absolute embargo, or whether it shall be made effective by the imeosition of a tariff is altoeether a question of method. If a tariff is imposed high enough to restrict importation, the result is the same as is accomplished by an embargo. To the extent that a tariff is not effective in restricting importation, just to that extent American producer;; 01 films are able to profit. As I look at it, the only question raised by the report is whether the importation of films into Germany Should be restricted or prohibited, or whether it should not be restricted or prohibited. The facts in the German economic situation today are briefly as follows: The German Government is obligated, under the provisions of the Dawes Plan, which has been accepted by Germany's creditors, including the United States, to pay to her creditors a total of 4625,000,000 a year, or so much of that amount as it is possible to pay without breaking down the economic life of Germany. After a rather exhaustive discussion of this matter with the most responsible people in the German Government, and in the organization which is charged with the execution of the Dawes Plan, this east summer, 2 Will Ne Hys, 2sq. 11.3,25. I cane honmcconvinced that the German Government is intending, by every No one knows as means in its power, to live up to those oblieations. It wisp ends upon yet whether it will be possible for Germay to do so. the extent, and the rapidity, of the economic recovery not only of Germany, but of those nations where Germany must find a market for the eoods Which she eroincee, and Which have themselves euffered as the result of the war. if the German trade, - by which I mean the eapaeity of Germaey to sell goods in ferolge martete Lncri see, the memeare of Gereeees capacity to pay foreiee debts will, likewise, increase. If OeMmanyle export trede does not increase, the only possible method by Which. theme pa, mmts can bo met will be by progressively and effectively inameasing the restrictions upon im ports, so that eadh wort Wei, as Germany is able to develop will be sufficient to cover the reparation mss, after paying for tbs.* sibeolute. ly ooeontial imports of food stuffs art tan meterinle Which eerenn7 lost bar itroad. The problem, in a word, is either to increase COMM exeorts, or to decrease Gernan ipparta, so that there mar be left abidance between income and outee out of which these oblirntions may be met. nor the Seportent thine for eermany, and for the rest of the Germaoy should it the last dollar of these oblie cations, and much =ore that the evidence of eeroanes sincerity Ln atteerting to do so eLall be oonyinciee and conclusive to her crelitore. world, is much lens la. 50 Seer as ny obaorvetion goes, there is only one way by which this convincing evidence con be afforded* and that is by showing a willingness, in the evel,t.thr_t exporte do not increase, to so restrict the expenditures of the German people for luxuriee and extraveeenee, - in other words, so to reduce the etenderd of lielaa in lererneethet there will be no Teention ehntneer as to the elncority of her puryllm. ncpr,-.41.ae., the 771roblem to seely to all of 7earope, in fact to the Whole world, ineteed of to Gormaey alone, it man n that the world today is will the work of restoration- and recovery faced with a very sieple choice: be el.eeete,e towards increasing preeuction, increasine trade between the nations, increasing consumption and theroby elevating stamdards of living; or shall it bo dIrectie.tozsld7 thenlonment of n system of "hratal Ind cruel international restriction upon consumption, - that is a ruthleas and heartless eyetee of rcAraint upon expeadituzes peecticed between tAel neatens - or than it be directed, as I say, tokrzle. the doimlopwent of trade and commerce. Now it DJ Irrpene that at the moment, for monetary on l. other con - siderations which seen to be centrelliee, the elliey of mney of Oermenels neiehbers has been to impose various tariff and other restrictions upon imports le ere not ouruelvie satirely fron from the pre eenre to impose from :)erm,,-.uy. Under these restrictions upon imports to this country by increased tariffs. circumetanoes, the tendency in Germany will he to impose reetrictions by tariff or otherwise upon her own ieporte. I do not think I would write yeti this letter were it nat for the fear which I have of the effect of a notion -wide propeeauda through all of 1 410 Will U. Hays, Eaq. 3 11.3.25. the theateee, or the meat bulk of them, which reach the peblic to an enormous extent, and which might have the effect of building up a sentiment of hoetility towards Geroany because of the effort of the German Government to impose restrictions upon luxury expenditures by her citisens, principally for the purpose of ueetime the absolutely just debt which she had obligated heeeelf tu pay in order in part to repair the ceasequences of the war. iere it a question of tooth bruehea, or apeles, or aaything of like character, I think I would be inclined to keep ey own views to el/self and not write you oat the thoaght trot it Le paseible to torn leoee upon millions this letter. of people in the United Etatee every day the enoreous infIeveace of the moving picture film In e propagnada to attedk the policy of the Germea Joverameut in its effort to meat its just obligations, gives me a feeling of despair. So I ae writing you to beg that you bear in mind that the importee effect, tioe of articles of luxury into Germany from foreign couetries ie, an impairment of Cleroanre capacity to pay her just debts to this country and that 4he impaeirment of that aapacity, if it is due to to other countries; an unnecaasory importation of luxuries, may indeed be justly regarded by Geranigia ceediters as a ca: sloes, Jr eoliberute, evaeloe of her obligations. And I firmly believe that no greater service can be performed by the producres of motion pictures than to auaounce to the weld that they are willia4y and gladly foreeeing the eormee market In order to aid 3ermauy in a couscieatious effort to pee, her creditoes. !L Of course I realize, as you do, that this argument can be carried too far, and that its extreme ae.licatien would mean that the pajment of these debts meat inevitably reduce a large pa-et of the world to a state of abject The aeswer is that those people, and those oreekeizatioea who have poverty. inflezeco in the direction of freeiag coxnerce from the restraints, euah as you feel apply to your trade with Germeey, abould direct it toverds combatting, by every meaas in their power, any effort on the part of any nation to erect barriers to trade such as I have described. I have thought this over for some days before feeling willing to If you have any doubt ac to the eouedness of my write you this letter. position, I wish that you would write me again. And if you would like to telk it over eite Dr. 36104ht,, with wilow I have discussed it, I will be very glad ieeeee to erreage a neotiag when I return to Xew York next week. AA any rate, please think it all over. Sineerely /Tare, Bill H. Hays, Esq., New York, W. Y. MOTION PICTURE PRODUCERS & DISTRIBUTORS OF AMERICA, INC. 469 FIFTH AVENUE NEW YORK CITY WILL H. HAYS PRESIDENT 1111ITI.A ND SMITH November 7, 1925. SECRETARY Mr. Benjamin F. Strong, 1718 H Street, N.W., Tashington, D.C. My dear Ben: OFFICE OF THE PRESIDENT PERSONAL. ACKNOWLEDGED NOV 1 0 1925 13 I have your letter of the second and appreciate it.' am in sy -athy grasp o the ole situa ion. ny propaganda, of that kind taken the people, with our Chambers of g yet. iculties when oduct against or ours is, I is on the is hard on us ecially when we o this country. lly that, because industry asked le in the not entirely r foreign this means get a Kontingent -- n of similar ountries. harnessed in ent, is going n. That is ourse, but I Ufa in an un. with you about it . st wishes, I am S; WO/ lb 1925 p RECEIVED A.v! 30VERNOR'S OFFICE Irk November 10, 1926. pERbowAL My deer till: Thank yoJ very much for your nice note of the seventh, Just received on my return from Weehinton. I can thoroughly underetend the difficulty sith which you and your colleagues are confronted. eometimee my reaction to verioue movee now being made in Europe - etch country to protect ite on trade without regard to reaction on other countries - is a rather aympbthetic coneideretion of tjee poeeibilities of lower tariffs end freer trade then just no seem to be poseible. The traditional attitude of thke country is such that I imeoer.thility of tny move in te..t receion; eltho.5h 'uhe reel teat is eau, day going to come in the contest between demand for debt peymoet on the one hand, wed enuillinguees to receive goods oa the other. But I do have b feeling Just whet the outcome will be, no one can say. of strong eympethy for tho,e countries which are entering into eoleme obligation to make payments sno than on the one hand are faced with these almost impenetreble harriers of tariffs eghinet their expolte, and on the other hand, with tremendous political and economic prtseure from abroad to prevent tnei erecting eimiler berries fleeinet their owe imeorts. reeli7e I supeose it its true enoeh to eay that every action of that sort seems to be hostile to some ?articular interest, and that no nation affecting trade reetreiete cell be aede perfectly Just end feir to all But I wanted you to know that in * general end broad way, viewing parties. interested ir the eronlee re a thole, rather than froi your etinei:oiet motion pictures end films, I haven strong eympothy with the difficulties of thoet netions, which include mere, on the Continent or Europe, who tre making an earnest struggle to pay their debts and discharge their obligations or honor. I knoe te't tr. Ech,;cht would be very glad to see you, but he wilL only he here for e week longer. There eeeme little more that I con do in the matter beyond &hut I h:ve, wed pooetbly I have teee too rrank in expressing my feelings. ,e4ncerelv you r3, Will H. :41S, 459 Firth Avenue, Nem York City. Bt.lk MOTION PICTURE PRODUCERS & DISTriBUTORS OF AMERICA, INC. 469 Fivm AVENUE NEW Yo Ai, CITY WILL h. HAYS PRESIDENT CAllb E. MILLIKEN OFFICE OF THE PRESIDENT SECRETARY January 3, 1928. Hon. Benjamin Strong, 270 Park Avenue, New York City. PERSONAL. Dear Ben: Vincent Murphy is an applicant for the position of Agent of the Federal Reserve Bank for the New York I have had a good deal to do Aith him in District. the last few years and have found him an unusually I know nothing about his peculiar fitness able man. for the particular job but no doubt he would be good. I do take pleasure in expressing this appreciation of his integrity, industry, ability and judgment. He is a good man. With kindest personal regards, and best wishes for a happy New Year, I am Sincerely yours, eed ( ie6feld S September lJ, 1916. Dear Mr. Jones: I am terribly sorry to have missed your call yesterday and it reminds are of the fact that we both mis3ed a very enjoy- able time at the mid-summer High Jinks this year. :ith kindest regards, believe me, Cordially yours, JesefEALAWMUMei 1=Factor, General Military Relief, American Red Cross, Washington, D. j. B3/MSB VG. 301 NATIONAL OFFICERS WOODROW WILSON, PRESIDENT rfAird RED CROSS WAR COUNCIL V APPOINTNENT r. c FRC:10F., OF TOE UNITFO 37117F, S October 1J1a. year _r. Jones; It was very good of you to write me so cordially about the meeting last 2riday. pleased. I sincerely hope that the President was It was intended to be a serious meeting and it seemed to me that anything that would tend to make it otherwise would have been a great mistake. I hone the President understood that the audience Which he addressed was a very carefully selected one, made up of the leading men and women of the city, who came there in the expectation of hearing a message from him of momentous importance. His reception was most cordial, but I think the character of the meeting itself exercised a restraintupon the enthusiasm which one meald ordinarily expect at a conventional mass meeting. The best tribute that I have ever heard accorded any speaker was the impressive silence in which the greater part of his address was received. The comments on the meeting, and particularly upon his address, have been universally favorable. I wish that he might hear them. Cordially, Jesse A, Jones, Esq., The American InEreless, National Headquarters, ;ashington, D. 113 B 1.7)0144 O October 11, 1318. Lear Jones: It was very good of you to let me see 1r. Tumulty's note of Dotober 8th, to you. I am return- ing it herewith for your filed. I am gratified to learn that the President felt pleased with that meeting; hero in rew York. Cordially, Jesse r. Jones, Esq., American Red151Pmerwm, Wadhington, D. G. Enc. ot, THE JOHN PRICE JONES CORPORATION Organization and Publicity Counsel 150 NASSAU STREET, NEW YORK OFFICERS TELEPHONE, BEEKMAN 1981 JOHN PRICE JONES, President awl rfrIMIZI1, GEORGE A.BRAKE LEY. PIV.V IfitIO I nod General Manager PARKE F. HANLEY, l'irePresnlont H.W. TH1 RLK ELD, l'ieePrrsidrn/ ROBERT F DUNCAN. July 29, 1921 ii.rePre.striovei Dear Governor L)trong: I should like very much to have you, as a member of the National oudget Committee, understand the financial situation of the committee and I take the liberty of writing to you because Mr. Pratt is away and you are the only person on the committee whom I know. For about two years now I The situation is this: At first I have been paying the bills of the committee. was Treasurer, then the treasurership lapsed for some reason or other and our corporation has been paying all the bills as they were approved by wr. nowe, Lirector of the organization. Outside of that we have done very little, as Mr. Howe has been handling the whole matter. Last spring 1 had a talk with iir. Pratt and at that He told me then time the deficit amounted t1; around $3,000. that he was going to have steps taken to raise more money in Now he has gone away without order to cut don the deficit. Since giving me any instructions as to the limit of expenses. then the deficit has risen to about $7,500. and expenses are going on at the rate of almost $1,000. a week. Frankly, I don't know what i r. Pratt's attitude on this I don't know whether the directors themselves situation is. As a matter of fact, in the absence know what the deficit is. of Aar. Pratt, I have no direct connection with the committee We are perfectly delighted to be of service to the itself. committee if the 2ommittee desires it and if they understand I am not personally concerned about a dvancing the situation. the money and although 1 have no direct connection with the committee, I should judge that A- have some responsibility to Mr. Pratt, because in the past he has always met the deficits. It seems to me, however, that my position is a somewhat nebulous one and in the words of the immortal Harriman "Where do I stand?" Mr. Howe tells me that he does not know what my arrangePratt are, which again adda to the complication. ments with I don't ask you to take any action or assume a ny responsibility I should, however, like to have you know the situation. ashington, D. C., July 30, 1921. Dear Lr. Jones: Your noto of July 29 is just received. (I wish I could givo you some definite suggestion about the expense account of the National Budget Committee. Perhaps the best thing will be to await my return to new York, and I will then call a meeting of the Committee to discuss _aye and ELans. Eby work at the Bank, since returning from abroad, has been too engrossing to permit of my attending meotirrs of the :ammittoo, so I am not fully informed of What reports Er. Pratt may have made to the Committee on this subject. I am sorry that the burdon has fallen so heavily upon you, and will do my best to get it straightens.. out when I get back. to New York. Sincerely yours, John 2rico Jones, Esq., The John rice Jones Corporation, 150 Nassau Ctreet, New York City. BS.LIJD August 19, 1921. Debx kr. Jones: Mr. Pratt ia sailing for home the Steamship George Washington to-day, and should be here on September third. Yours very John Price Jones, EaQ., c/o The John Price Jones Corp., 150 111106ftll St., New York, N. DS: *1 Y. 0 December 18, 1922. My dear Mr. King: I enjoyed my visit in Chicago with you very much indeed benefited by the frank talk we had. it is difficult to get any publication which exactly Jf course, the questions that were in your mind; answers but I have endeavored to do so in what I am now sending you. Please do not be ap::alled at the sire of the bundle when it arrives, for it will contain: (1) The Annual report of this dank. (2) The Annual Report of the Federal Reserve Board. little book published bi Professor 6. (3) R. Lerverer, of Princeton University, called the "A 3 C of the Federal Reserve System", which will give you some idea of its theory and of its oDerations. (4) A copy of Part 13 of the Hearings of the Joint Commission of Agricultural Inquiry,where certain passages rave been marked relate to the extension of credit to agriculture. that particularly I ar sending you this volume especially because it contains not only the statement which Governor Harding made and which I made before the Commission, but also a Skelton WilliaTrs, who has been statement made by John one of the principal critics of the policy of the Federal Reserve System. (5) in A copy of the report of the which you will find the various to agricultural credit. Joint Commission of Agricultural conclusions which it has arrived at in Inquiry, regard 0 December 18, 3922. My dear Mr. King: I enjoyed my visit in Chicago with you very much indeed end benefited by the frank talk we had. Of course, it is difficult to get any publication which exactly answers the questions that were in your mind; but I have endeavored to do so in what I am not sending you. Please do not be appalled at the size of the bundle when it arrives, for it will contain: Annual (1) The 1-ieport of this oank. (2) The Annual Report of the Federal Reserve Board. (3) H little book published by Professor N. liemmerer, or Princeton University, called the "A 3 C of the Federal Reserve System", which will dive you some idea of its theory and of its operations. (4) A copy of Part 13 of the Hearings of the Joint Commission of Agricultural Inguiry,where certain passages have been marked that particularly relate to the extension of credit to agriculture. especially because it contains not I am sending you this volume only the statement which Governor Harding made and which I made before the Commission, but also a statement made by Skelton Williams, Federal Reserve (5) A who has begin one of the princigal critics of the John policy of the System. copy of the report of the Joint Commission of Agricultural Inquiry, in which you will rind the various conclusions which it has arrived at in regard to aricultural credit. e Atf< JAN LEDGE - 7994 Guthrie Center Iowa Dec 29 1923 Governer S4..aaj You probably haVe forgotten me. If ypu will remember,we met at theNational Convention of the Ameeican Farm Bureau Federation.Yoe was kind eno,.711 to send me some liteiature on the la-9 governing and the fundrioriof the Federal Reserve Systee- I sure got a greatdeal of good froie study of them.In my work in the Farm Bureau.Ibelieve Iwas able to counter act a great deal of prejudice againseVeceDal Reseeve System. We are studying the system of taxation in its present worke ing form and several proposes new plans. At 3ur community meetings and at our Chamber ofCommece meetings we: are having discueions and round table talks on the subject. TThere is a great deal of prejudice against the issuance of tax free bonds of any description. ,160494n the evening of Jan.8 T9'ee4 we have a county meting and I am elsted for a talk on the side of issueing tax free bonds to a limited amount. I thought you might be able to send me some literature on the subject in favoretax free bones and give me the vi .w of the tae tern frori a financiees view point. I belieye the east axle the west and the farme and the cast ern manuferer andt the great class of moneyee sun will get along bet to and all get back to a sound basis quicker if we got together oft end and on nietral giound to disAcuee,our mutual problems. I believe the Federal Reseaeve,the .farmer of the middle. iest have both p*rof ited by mutual contact a nc gaining the viepoint of each other. . Ta.::es are like castol oil they both leave. a bad taste in the m.eeet meeAe,but they are necessary to get results.They are both efficacious. The big problem ie to aeministee them with the ieaet objectipn fro:- the patient. The question is whetbee it can be done throLegh indirect tax(.., by a s-Laight sales .tax,or some less objectional way! I will be glad, to give you any information on any topics I can at and time and hoping I am not asking an undue faver I remain as eve: . John W.King Guthrie Center R 5. Guthrie County Iowa Iowa,the state that has every class of clircate and every element of the soil,feom which she can gow any hind of produce or man. We geow elany men of wisdom as well as the other extreme. We have been glowing many of the othe- kind lately. ("Tv/'-' Junury 7, 10'i-4. fly dear Mr. King: You Ere very much mistaken in essuming that I had forgotten you. remember our meeting very well and have often :iondered whether you had the courege to wade through the mass of literature that I sent you after our visit in Chicago. -ince the meeting, I have hed a rather long illness, but now and then see some of your friends and especially Cunningham, who is now a member of the Federal heserve Board. As your letter only reaches me this morning and the meeting which you refer to is tomorrow night, I am afraid what I send you till be too late to be of any service. There is so much to be said on the subject of taxation, end there le so much of a background of dissatisfaction itreat paying taxes, which comes down from the feudal days T:hen no private property was sacred avinst coafiection by the King, that one must realize thet the whole problem of taxation is not only a financial one but it is likewise a social one. There is no use in attempting to im?oss texes which by reason of prejudice or any other reason cannot be collected. find the People means to escape them; or if they become too burdensome and oppressive and too direct, they will simply change them, because c,..fter all the vote of the people is capable of accomplishing < rlything in change oflaw if enough of them vote that way. It has always seemed to me, however, that there %re eme very simple facts about taxation which we can always bear in mind with profit, and while they may be a bit idealistic and not capable of realization, we can get as near the ideal as possible. t least make an effort to For examlle, no governmen Mr. John W. King 2 Janu:ry 7, 1923. up debts with when to pa.ite running expenses; and smoothly if it keeps pilin a government - like an individual - must spend less than its income, or in the case of the government, must collect more taxes than it spends if it wants to remain solvent and to escape the penalties of inflation and an unwieldgy government debt. Now as to the form in which taxation shall be applied. There are all sorts of theories on this subject, but it seems to me that the test is the fundamental one that any system of taxation in order to be just must distribute the burden of taxation over all the people of the country in reasonable proportion to their ability to pay. Henry George the single taxers alway accomplished by having but one tax, and that applying to real estate inasmuch as real estate was the fundamental property, the ownership of which was so widespread and the use of which and the fruits of which were so universally distributed that the taxation of real estate would be more equitable and result in an evener distribution of the burden over the people than any other system. The single tax movement has almost disappeared and for your purpofe need not be diecuesed. The next important principle to decide is whether taxation shall be direct or indirect. The most highly scientific direct tax which has yet been devised is the graduated income tax. Probably the most scientific forms of indirect taxation are customs or import duties, and sales taxes. serve your purpose. The Discuzsion of the latter would not . however, is directly to the point. It mutt be borne in mind that every tax of every form is ultimately borne by the ultimate consumer in the increased oost of the articles that he buys and uses and of the services of individuals whom he employe. Theoretically, again, if every citizen of the country could be taxed exactly in proportion to his capacity to pay taxes, and if such taxes could be completely and scientifically collected, the burden of taxation could be distributed entirely through a direct tax on all the people, and the aurden adjusted according to the means of she tax-payer. This is a very difficult law to administer and a rather expensive one, but is probably the most just form of taxation that has yet been devised. A gale tax, on the other head, while po sassing many attractive (4, Co. 1. 18,1 al c.,,," Mr. John 3 . K1ri elements, especially those of administration, nevertheless, Jenuery 7, 1.9f4. oording to my view, contains many inherent and unescepable injuetices and any law establishing a sales For ex- ax is exceedingly difficult to draw so as to minimize these injueticao. amiAcp suppose we hed e universal sales tax which applied to every single thing that people bought. The injustice of each e tax becomes apparent ehen applied to en article of universal consumption - like bread. Contrast the effect of a saes tax upon the bread consumed by a poor man end that consumed by a rich man. Say that the poor men has an income of ;t100C a year end hie family conrists of five persons; gin: the rich men bee en income of $50,000 a. year end a family of five persons. femiliee consume equal mounts of bread. Let us assume that the cost ie .1'100 a year, end that the tax, for the purpose of illustretion, .mounts to $10.00. man is paying s tsx of 1 The poor per cent. of his entire income, and the rich man is ptying e tax of 1/50th of 1 per cent. of h'e entire income, upon a necessity of live. is the trouble with Thet sales tax, ..ead it is difficult to devise a sales tax which will produce an adecuate income without applying it to necessities of life v.hich are consumed in bout like (uenOties by both rich and poor and which, therefore, ;lute too much of the burden on the poor. So it is elm) in this m-tier of tax exempt bonds. It creates t large class of citizens who cre en jcying incomes from investments, in other words, incomes which re not earned by their labor, upon which they pay no tax whatever; eherear the men !ho earns his income by the work of his brain, by organizing great buoinfeees and developing the country's reseurees, if he is successful) tax indeed. is payinp very large The argument about tax exmlp+ securities, like St ate and municipal bonds, has always been that the rate of return is so much lees than upon other hen s -f equall goodness that the State is able to borrow :.c much cheaper, and the effect is just t.e sane, as 4 tax collection. the . argument is incomplete. income of 1 million a year There is, of course, something in that, but For example, upoe a graduated income tax a man with an might theoretics11w66liged to pay te.xes of $400,000 on Mr. John W. King Janus ry 7, 1914. taxable securities, producing a 6 per cent. return on, say $17 millions. income would be $600,000 a year, or not much more than 5-1/2 per cent. *tax exempt securities toeay of a high His net If he bought he could realise an income of 730,000 or $740,000 a year, and possibly more, and in proportion would probably be paying considerably less taxes than many people who pay taxes, u; on earned income e. this is a. very difficult conclusion to establish by figures. But One of the greatest objections to the tax exempt securities lies in the fact that it creates this class of rich people whose tendency is constantly to withdraw from business enterprise and from the employment of their money in productive inveetmulLe which would benefit the country, in place of which they put their funds at the commend of the States and miniof the oiphlitiee at low rates of interest, thus encouraging the political subdivisions country to financial extravagances. Of course, the principle of tax exemption has been applied to the securities issued by the Farm Loan System. I have alway- felt that that was a mistake, that it was a species of class paternalism which was contrary to the spirit of American democracy, and that in the long run the farmer would not benefit by that kind of class legislation. There is no doubt that the distribution of credit in the differ- ent sections of the country follows the creation of weelth in the different sections. Such accumulations of liquid capital stimulates thu creation of banks which grow up from successful end profitable production and trade. Our West is still too new, the population too sparse and greatly scattered, the country is too singly devoted to agriculture as distinguished from industry to yet be able to accumulate its own sur- plus of liquid funds for lomine4 DD that the other sections of the coun ry must he drawn upon and the creation of thee loaning institutions with the power to issue securities free of taxation undoubtedly does have the effect of inking it easier to market their securities at good prices and consequently easier to draw funds for the farming industry into those eectione where investment and liquid funds have not yet accumulated. But if the principle of tax exemption is unsound, and if the principle of preferring one cites of people in the coun ry over another by tax I k * cr o +- c January 7, 1924. 5 exemption is unsound, why would not the farmers in the long run be better off by accepting a financial system thich indeed might cost them 1 per cent. per ennum more tor their mortgage lons, but, on the other hand, would put them on the same footing as.r11 other classes of people in this democracy, and eliminate from public discussion - matter which has many elements of controversy, dissatisfaction and complaint. The farmers of the United States should not overlook the fact that the ease with which StAes, counties and municipalities not borrow coney ceuse of t very low retee be- tax exemption, is one of the C&BEt8 of constantly increasing taxation to meet the interest end sinking fund on 1 rge debts encouraged by the extravagance of State and municipal officials end legislators and that these very extravagances are fostered by the pplication of aux exemption to those securities. I have written you very much as I would have discussed this retter with you had we the pleasure of a visit together. In addition I am going to try and look up a little literature on this subject, having- the courage to do so after reading your letter and gathering from it that you really found some interest in reading the books thet I sent you before. In the long run, it is my personal belief that the people of this country till be more contented, till be better citizens, and that its financi'l affairs will be better bdministered if the principal revenues of the States the Federal government ere gathered through systeme cP direct tax, the mount of which is graduated among the different classes of people according to their aibility to pay taxes, and that the uneeuel burden of indirect taxes which re added to the cost of living without the means of apportionment as above mentioned torke more injustice upon the poor than almost any other instrument of Government. Yours very truly, Mr. John 1. King, R. 5 Guthrie Centre, Guthrie County, Iowa. BS.W' John W.King Guthrie Center 5 Iowa Febrary 18 1924 AC Wr.ED0ED Benj man Strong. I received your letter and was glad to note the caiekis1024 Ioften think of the meeting with you ane with other men fro other part of our county that I enjoyed in Chicago in as will as in I923.` 4, I have seen all the states went of the g- eat lakes ane the Missouri river. To appreci34e the extent of our country and the vast diffirence in the classes of ineestry there is in the U.S.,it is necessary to see some of it. Then,to be a fair minded citizen it is necessary to put your self in the other fellows position and see what you would want in his place. It takes so much better eye sight to sec the other fellopws rights than to see our own. 7e have so many men that have never been any where and do not read pi4e much.Some do not t ke any papers whatever and great many take a daily from tae nearest city anu never read a. magazine or any other literature whatever. They have never trained their minds to think for themselves and the conseouences is ,they are fertile ground for any propagancia that their specie paper puts out. And we are gettind a new special brand handed out about every day.Some of it is almost as deadly as the moonshine that is made in the littlt valleys along our Raccoon river.The Blue Ridge mountains of Tenn. has nothing on our hills here in Iowa when it comes to production along that line. We have our Brookhart.Some of us compare him to the measles.WE have lov been sick for a Oyi time and about the time for a change we broke out in a rash.With measles there world have been a bad swell and we would have got weli With Brookhart,we haee the stench but have had no relief. We are now having a wave ofKu Klux Klan.It is sweeping over the counIO.per. try and taking in the discontented and ieresposible element at On acce -nt of my activities in community affairs,I was asked to one of their meetings and I went as I wanted to hear their plan of working. It was about as I thought it would be.He was a good lecturer and he of them knew got away with his talk.He talked fast and gave statistics that nothing about and he had them hipnotized.They would swallow anything he said. When two of us refused to join and give over the $10,he se_id we would be excused.I wanted to tell the crowd what my objection was, but he would not let me.It seemed to me ,there was a thin veneer of charity anu goodfellowship over the rankest of racial and religious hatree.He was rank anti-Catholic and anti-Jew. It is nothing to me what a mans race or creed is if he is a good citizen.And any one that does any thing to stir either one up is not worthy o of a home ender our flag. We are having enough trouble without stirring any more. Ther has been three bank failures in the county this last year. There never was so many voluntary bankruptcy proceedings ana foreclos ere sales by the sherrif in our county.Many of our farmers are hanging on in hopes of a better future aheac of rs.If they go down in any quantity there will be an unrest created that will be hard to handle I have not enough brains to know what is the best way out for us. On our credit side we have a magnificent balance of sound integrity and respect for law and court proceedure ana an inexhaustable supply of energ y and health.We have the greatest and richest corn land in the world,and that means the greatest hog cattle and sheep and pc) ,lteycountry in the world. Our resources are only tapped,ane we have the security for loans of untold millions and the most important of all to us is that it is good enough that it shoeld command the lowest of rtes. W2 are hard up but the great majority is sound,but unless we get lowe er rates we are doomed to a lower standard of living and that will mean a more radical element will be sent to o r senate and legislature,and that will mean a more unsettled state for indestry of all kinds. By rates,Imean,inteeest rates .Lower railways rates would help but not nearly so mach as many think. 2 lbWe need lov.er rail rates on our bulky no low value articles and could stand higher rates on more val able goods. For instance; a raise of I cent a pound on clover seep: te-t is worth 30 cents a pond would not hurt the proerce: nor consumer vey much while i of a cent per poune on clover hay that is worth i of a cent poune would simply be prohibitive. You see the hay would have to rot ane be a loss to the producer and the railroad would lose the freight that it might ha- c. earnee ane the consumer would have to use some other sub stitute.There is many instances like this only not so extaeme,but in the aggregate they amount to millions of dollars. Our interest rates are higl.They run from 5% on gilt edge farm' loans with i% commission to 8% on personal notes.Many unscrupulus bank ers charge an extra commision with the sky / for the limit. Some men that were caught in X22 anti 23 and had to renew their loans;were charged as high as 7% with an additional commission of 5% for the accommadation.That is what has made so many of our people so radical and ready to listen to the tirades against a Wall Street that was mace to look like a devouring lioli.And many think that the Federal reserve took advantage of the conditions. Now when the local banks are getting what money they want from the Reserve at 4i-% they are charging us 8% for it.This makesso much dissatisfaction that it may create a spirit through the middle west that may do harm in the f ture. The trouble with so many of the miewest farmers is that they do not know who or what has hit them in the past ane will not admit any blame them selves ano so as they begin to feel their power through their q4 organizations they are ready to hit any thing that comes in theia way. Having to content. with the forces of natr:e in the shape of rain anti erought am wind storms ant.: uncertain roar condition: ,naturally make of us a conservative people and working alone in the field:, and communing with ourselves so much make us set in our ways ane whtn we do run amuck it is a good deal like the Arab of olc,we do not know when to stop am, freuently friend an ioe look alike for awile. We have been hurt so grievioufiXisin a financial wy by our own lack of foresight and by the crookee/or many men ane institutions in whom we hat., the utmost confidence that we as a class have come to a frame of mind in which we will not trust any one. That is the reason why so many of our fellows thnee crown the wheat conference in Chicago and are afraid of any great cooperative marketing plan that involves the necessity of signing up a binding contract with a central marketing agency.I do not see any other way to eo,because such a plan will need millions anu men of ability.Such men will not come forward without something substantial to work on and good security for their money. With so many of o r farmers the name of Bernard Barech,Julies red rag to a bull.The cueetiou in my Barnes,or Eugene Myers is like mind is how to eradicate this feeling anti to be sure of whom we may thust.If confidence could be restored we could all start on the road to the greatest prosperity that our country has ever known.It would go from o ocean to ocean anu from Canada to thee Gulf,ane would lead to a way for helping across the water. I would rather have a hand in acclompliEhing such a movement than to be a Jenny Lind,or a Hawthorne,or the greatest general in the worle. There ,i:/ are thousands of community meetings being held all over this country and most of t em are well atteneed.All the way from TOO to 500 hundred people at a meeting.These are being hele in little country churches and Legion halls anti contry.club rooms.It is the greatest place in the world to generate a program that will work out a salvation for ourselves and our neighbors in other lines of work. I only wish it were possible to have all our people to hear some of the men talk that I have had the good fortune to hear.I believe it would . - 3 ave a tendency to correct some of their biased opinions.. In compariso to the East we are a scattered community,we will average IIP about four families; to a square mile and a town of about 700 to every 8 miles square anc a town of from2000 to 5000 to eve :'y 3 counties. We are improving our roans every yer so that distance doe not count I when I I have bothered you enough for this time and so I will as it cid believe was a boy. close hoping that your health has been improving steadily. At present we are shut in with snow and rain and slush,but the spring time is.coming and we can feel good over thinking of the new crops that are coming on anc. we will all be in a better frame of mind for the future. From one who has faith in the future John W. King Guthrie Center Iowa R 5 P.S. Coulc yo give me the address of Bernarc. Baruch and of Julius Barnes so I coulc get by their secretaries,directly to them J.W.K. ^ _ claim ,Briculturat treat (C, F. H. JENKINS. PRESIDENT FRANK MONTGOMERY. VICE PRES. NISSEN. SECT-TREAS. pagItg, Plafint 110 A 76k I. 'V 14. ti > clitYee 71441:-. a-v-41,1---, er ,2 0+45 4j. A 9 es-44.4"o a--- -oett-t-t4-7-1 *711, -47,441.x., 76; 6- ".47 ,(7 " ,e-e-se4-4 e/ .4.1iew fo,44,1 oil .1,,..,e, -tet'''' A ,:.,,e1....4,-.1 ikA...it A, .471,06-2.-,t, c ,.1 e, 420404.,014 0, / e< or 14%.,A, 11 /11 4 ill e..t..f. '77' z ' t4,-.4... Iti.,t -,./e?-0-40 /./ _-76 . -1:--74-'PtI-re k if ".e.,4.4 4-4---%., A, er.ri 4 21.! et- If- -14- zi-e-e /14et.,-14.- 0,- et ( erl--e eirt7 4.144.-e_1( --.0 ()--- 14:71f ) ie.--trdrLe ip.v egt,,( 2,4 ct 4 -14-, e.' ii-1,1 ..c-A, 4 40.4.4.i ex,..1, e.--ttye, /-e, (.,(2.) ....fri -44..,.. :7* L44-,- 1,,,,,, 71 ,' 7,7 42..... ei - I! il --2le# e.".,/ , 17:1--; 'I ,1-4, fr g",,P7 Z. tr- I fa. , ' 1 2,.... /11/4(:/r/ 0, / 1/ 1.1 FH I - DIRECTORS .,INS. PRESIDENT MONTGOMERY. VICE PRES. SSEN. SECT-TREAS. - W. J. ELLETT, COON RAPIDS. IOWA F. H. JENKINS, BAGLEY, IOWA FRANK MONTGOMERY. BAGLEY E. C. NISSEN. MANNING. IOWA C THOMPSON, PERRY, IOWA 14 aim Nrirultural iIritif (Corporation !agteg, 11! 111fun ,K4A--e t-i C-4 e"-L- a c 17-1-1) -iv:" et-( / (41, -40 4 '24,114., /1' 4/7 elL irt,.\, 1t/ C7 14-4..... v t:-. I fp..., --4-., at; -.--, ek A 1 V Farm Bureau Member. J 0111 NT w. K I -: Route 5 :- GUTHRIE CENTER, IOWA r, Phone No. 6903 Bagley < ,,,- ,(---'",''.--. 7 4--e- ;/(c._ 1 A-)..-1/ ,c) 4,,' ( (..17 4-114 - c,,) .- , ..,. - /,( : Li t,...,, -4 ,`: ./-,? f / 7-7' n) '445r.4?° / / 47 77' !.,- ,-1. i 1_ rc.1 7-? / / ,'IP t ( . z(' -"! i-t fr,7, r."4- ( ' r "c-c , /A,/ _e e!';` ) ( / ;/ / ( / c. I ./ s- /-7f ,' r ./ z' _ A Bureau Member. Phone No. 6903 Bagley JOIi 1T W. KING-: Route 5 :- GUTHRIE CENTER, IOWA .77 i( xi e.,4 4,1 --. /'c .,e, 0,..-. 1-7,--faile.(-1; ( - , . ,./ ) -1-1-e.- (_ e... - ) :9 f - -I'' ' , -, if 7" -?. j-71-44e."--z, /---<; / 71,--,,,/ (2.374 -4 -e" /J7/ IP- ,-7,f__.-7_ : (/ .,- --/ 1-,..- ti ity Az-4? /Vic L.- ( 4.---t-.- '-:--- i .7 t/ / ea-te40/ /2 Z. C ,-f /YM t t rle ll_lii 1 ( er-z-t.. . ../ / 4j/ )J! 74C`rt.e., -e° 24,/ ( / 1- (.7 7. t) . 6 / iJ4 t,e/ el I tea 414 4. 7b ef -44, ,--:// ./.e., ---1---1-1/4-- . .. 2/1,1 /". ., _lie7A----71:4 /si, ittl.el,cifie 14 "ttT +,..) .--1-.. ,i4._--v l -1---r- -o/a t,.-e-- .--",14- 41( 1 7 ze -7 a « « « ,k(^ , I'('`/ e- 7/ .-7,6-/ ( / f ." 7' CII" (-7 e e 1. 97 ' -(7' r .. 2 (...-",""`"*/...:: .:"..; : ; , .., -74 7 e-1....... t., ,? ))/ Farm Bureau Member. J Phone N W. Bagley1\7I-1 No. 6903 I -: Route 5 :- GUTHRIE CENTER, IOWA fir" f4-4.-IT L./ etr L L2 g-7 A,/ ,(e e)--e h-z-ef--;?-t---y ' .-e./c-,-)(/e/- 14, -7/1/;10, ( ;4c.". 1/4-- e- 2-2,a V _ 2 e/ 2_ v: fe" 41" V / erC__.--51/4, .-1 _ c4.-- 1-t-sk.._ .,,.(..?,1 ty "e ...!...._ c Cr'--/I---.- ??-if-i_ 4,- :'.!. A,--/q v....:// a, -,,-.-t--4.--cd . a444. Phone No. 6903 Bagley JOHN W.. KIN -: Route 5 :- GUTHRIE CENTER, IOW 441:,. 46. **.Zit 4P 4.44 11/0 -ems 1/1-6:16--so e7-te_e "Le-7-24_ bezZ-1 a 4yeet.t. 0 ) te-c .64 e t/14-10/ 7;-/-dr ' . tile , 7. 7 . / L-/ -, 1()7e-C -17,--- ws7-- 11 .r-e, t 7,4 e I -e4-?_L -4-1.--._ /.,?_;i) )--e . 7-1(--<, C / / Ivo / /- / C i rc ,?;;`, ,, .-",--(1_ ( i c-ce ,- ../ 62 /it< --/0. le_-E/ -e±-2 ,..2--/e.e._ `. / /; (..92 ..i a, ( / //f 44, / G. 7 ( (7-( 7- ar-7-i Ler-1_4. /-2 a-- Farm Bureau Member. Phone No. 6903 Bagley JOHN NAT. KING - : Route 5 :- GUTHRIE CENTER, IOWA Y,e-de.t_ezt _tun. /?-e /4-2 452 ez_ _E4 11 / it_Zi-Z-j 1 t-affs-r--- 1- V "b2-4-7.1--eel ce.e........, z-?`_/.:( jet ef_., ra--14-1-4". , ..._/ a..-- e U-?,t :, r ?-eP t I ":11-e--i/ lia___-0 Gt * )/if 6-?-, .--41.--e. cl 74, , 4, , 0 LC) a C--IS.. r ti....- (1,1 "io, - ic4..-,47)a v-/ ,3 1 ,4, /,,,--,,,,__?;,,, 7t----/... r r f7-(Y-6"-i'_ '/ _F.- 4_,, ,.ept±e '. (i-Ct Phone No. 6903 Bagley Park Bureau Member. J C:) INT W. 12C I /sT -: Route 5 :- GUTHRIE CENTER, IOWA II/ 7fr- IT j4rrj 7.4 1,, 0, a "?' e/w 1- - 7 r4 kc."--c-t-17t 17" la-,04 VA-6k. 14cz_vo ("I-e 0000, (e--L -2- A t C-'( )itt 46 1a A a-L.)2 /-/-6- / I 6Y. r't c, /r lav-t) fu/V rL/ /q,0 (// 4/0 /-Z-b 462-e-4 ,.1-0 1bt(J( gt. -c-- /-1 IL A,ti-nit, dia t"--e---77--e--"d 04/-e. ei / e /--() 1,a1-4_c Farm Bureau http://fraser.stlouisfed.org/ Member. Federal Reserve Bank of St. Louis 0 Phone No. 6903 Bagley MAW neaing .iaqtuaki MAW d 'ON EO69 I' 10 I-I 1I all1111119 lia.LN33 Apr .1j4-7- _0-7V ,/1-7 77 ' VMLOI 7 6.--1;2_./7"7(0 94. "?--ev277--- -A- p y,e2 _lere4---41'.. -4 1-f 7yi TJ )---).1/ ,tiaputi I _NI -0 7-v? P-7-de-;;19 --)L? V2:2 _OZ.& 0_74tpy ''_mil vat 74--a4-,/y7 V-40171-44H cY--" -1." ' ""' -7.7' -.."'n' [rglIrriri7M.""-n771.111PRILMOIF.L7r"...-".- Phone No. 6903 Bagley J 1-I INT W. KIG 40 Trim Bureau Member.-: Route 5 :GUTHRIE CENTER, IOWA At-t-e-1-e,v ti-ef -e a Q -2,4/7 114 V-74-t ti---6--2,374 i:15 A, 7- 1 2,, --e /// _.a -c L e- 1-) 6 Palm Beach, Fla., February 9, 1925. fly dear Friend Zing: Your very interesting letter of January 31 has been forward,A7 to me, and, as is always the case with your letters, I have read it with a great deal of mjoyment. L'y interest in the beauties of this place has been entirely confined to golf, but, if I tore you, I wouldWt be so sure in asserting that some of the beauties down here are 'iunkissed" -- I believe there is evidence to the contraryl Some time I am going to make a trip out to Iowa and have a look at some of those farms, and talk with some of the farmers. Of course they have had hard times, but things are looking up and this is no ti e for discouragement. Rumors of the banking troubles to rhich you refer have reachel us from time to time, and I suppose it is a fact Many of the banks are loaded up that they are not over yet. rith loans which sere made for the purchase of farms at inflated prices, and, of course, it will take years to work But I don't ree why the Iowa Farmer out of the jAfficulty. should be particularly blamed for being carried away by a speculative fever which absorbed the entire country. Certainly we say the same thing going on in 17ew York in almost every kind of commodity that is dealt with and speculated in, and the losses here were in proportion, I suppose, just as great as those that occurred in Iowa. I am especially interested in what you write about It is a very difthe rates that the farmers pay for money. ficult problem which I had hoped would have been rartly solved by the operations of the Intermediate Creit Banks. They have helped somewhat; but undoubtedly not enough. ifficulty lies in the fact that the surplus The funds in the money centers are not directly available to the borrorers in those sections where there is a shortage of bankMany proposals have been made for remedying ing capital. this difficulty. One is that we should develop a system of state-wide The argument in favor of it is urldoubtedly branch banking. that it would in course of ti e effect some reduction in On the other hand interest rates to the small local borrower. 11r. King -2- 2.9.25. there are strong arguments against it. And one is that local banking autonomy would gradually disappear. The management of small banking offices in small communities would be in the hands o managers who had no local res7onsibility, and little freedom Our system of independent in dealing with local situations. banks would gradually disappear. It would tend to create a system of huge banks controlled from the money centers. And I rather doubt the desirability of any such development in this country. 7e are too inclined to compare branch banking possibiliVes in this country with what has hap:ened in 2urone in countries of very small area, uniform population, and short If re are to have distances for comunication and managem-nt. any system of branch banking, it should be by gradual growth and volition, and not as the result of a mad scramble by big banks to buy little banks all over the country. .:mother proposal has been to have the Federal Reserve Banks make (Arect loans to private borrowers and do business with private customers. And one of the principal reasons advocated for their dealing direct with the public has been that it effects some restraint upon the rapacity of the commercial banks. But again I doubt the wisdom of any such developIt would antagonize banking institutions ment in this country. generally against the Federal eserve System, and might, in the The conditions which now exist in banking end, break down. in this country are similar to those which have always arisen in new countries, and only the growth of the population and In wealth of t7:le country will in the long run overcome it. t7-e meantime, good old fashioned economy is the thing that is needed. e have A.iminated a large part of the country's liquor bill, but in its place we have the automobile. And when one considers that this year it is estiated that there are 17,000,000 motor vehicles in operation in the United States, many of them causing a real economic waste, it is not hard to understand that lack of saving may have something to do with these difficulties. But one thing I have difficulty in understanding is the urgency with which the question of the rate of interest on borrowings is advanced by the farmers as though some i nroveFor e:.:ample: If ment in that matter would cure their ills. a wheat farmer with a quarter section of land raises 2500 bushels of wheat this year, he may realize, say, \4,000 gross for his crop, whereas last year he may only have realized .,2,000 gross If he and have been unable to sur7ort his family in comfort. is borrowing 3.,r5, 000 on his farm, the (7ifference betreen 6% and8on the money is only ,0300 a year, as against a possible fluctua2,000 a year. lay tion in the return from his crop of, say, o Lake George, 1%. ''arch 1, 1919. 'f., Deer 7'r. Paine: acouaintence "-ith became connected Beker commenced fiftem yeers ego, when But it rtr not until with the 7enkers cruet Company in 19'3. nctobor, 1.907, 'hen the manic burnt unon us in "all Street, that Thad the privilege of a more intimete reletionship. I well recall the dray when, after a very hrcty end incemplete neerninttion of the Trust Company of America, I rus called to J. P. "organ ono of i;emneny's office to make a report. Men I vent in, llorgeni s nertnera eaked me to sten into a rear room and to elloe 7'r. ""illerd 9. King, then vice president of the New York Trust Company, vho t8 a member of the examining committee with me, to report to a meeting of trunt comneny nreeidente that ten being held in another office, ee "r. "organ wished to have e telk with me privately about "het I had learned of the company's affairs. Yr. ',`organ came in 'ith Baker end "r. JE83313 und stated in a rather etrohetic reenner thet nothing could he accomplish el at the meeting of trust conineny men in the next room; bourn -ithout rerult; and it that they had b was hopeless to expect en talking for some results from a group of men "*he e-ere so little aceutirted that they had to be intreouc d to etch other I spent porsibly an hour, stating my impression'. of the Trust when th eY came in. Company of hcorica to t-'r. Vorrs,n, "r. r'elker end 'Pr. Ftillretn. 1 recall that there wta no hesitation in their agreing that advances must be made at once to the Trust Company of emerice, even at the considerable risk involved because of the little then known of its condition, as my report coele give but slight end fragmentary information after the hasty exaninatim that had b-,en made. _h set Ne. 2 Yr. Peine 3.1.15. Sheet ro. 3 Mr. r bine 3.1.19. Ileet No. 4 of courage. Ur. ?eine will It doubtlesc sheer° of every corneitment shoen that the Firet National !3nnk took a large for the general good that was made, and I have na doubt reknit that he had no expectution of incurring any thet ?'r. Banker would to-dry serious loss in connection 3.1.19 Kith any one of them. 14a hed faith: `!y confect with him in subseeuent years, until April of 1917, had to do orincinnllv with the routine of the businees teci development 04" the Flenkers Trust Genet:my. .As soon es !7ecretery rc;,doo decided to employ the Reserve Banks to out his nrogrem of war finance, of benkers to runervise es en edjunct of the it ca:ry beceme necessary for us to organize e. committee these oneretion in behalf of the Treesury Department, end etff of the Federal Reserve Bank. Mr. Baker I:octane a 33 ek7, her of that committee, vnd I think no relationship which I have eve .r hed eith him has brought out so clearly his, courage, snd, st tht same time, hic m'>dosty. Weer men of hie flee end lonr exo-u'ience in Nem York might hevn hesitated to ac- cent membered?) on v. committee of flint kind, and felt that it snoreprivte for on > of hip ctFff to servo in hie piece. 70eeri r ides from the start. Ha not only became one of its mart regular and feit;:ful But enulci have been more thet wee never "r. manber of the conecittee, but attendants. It soon develon3d that the committee, in Fddition to sseumini: responsibility for raising funds for the Government, had become, in for the ehole money situation in the city of Now York. inge from the bunks incrersed, there wss e their loene mode to members of the a met:aura, reuponeible As the Gov3rnment'e borrow.. strong tendency for them to withdrsv t--ck :3xchunge, and repeatedly, it meetings of the committee, it mzs necessary to raise lsrge sums to ha loaned on the Str:at (sit well es ltrge amounts to be loaned to the Government on certificetee of indebted- Sheet No. 5 Vr. Paine were) from the institutions represented on the Committee. 3.1.19. rr. Baker sae almost inveriebly first in making large pledges of this charrcter, end it bectele n v,rtion in the meetings, -hen these discuesions took piece, for the recretrry to heed him 5 pad and pencil in order thut he might ?sake apeortionments around the table, which semetimee 'were for mounts aggregating t50,000,000 or itsool0000. The mereb,rs of the Committee accented generously end rillingly a certain leader- rhip by !!r. Raker, in thin IV tter, sn:t showed great deference to hie vises. M. rtme ..es true in nh,cing the Liberty Loans. in the first loan a sub- committee rrs appointed to eolicit le.rge subscriptions from individuals E., nd corpora- tions!, yr. Lamont, of J. P. Morgan & Comeeny, being chairman of that committee, and "r. Lamont eubsequently told me that *bon the lint ran mt.de Mr. Raker e member. uwi, ?fr. ns-ker coereeristed by ft,r th largest number of nemee on till lift anj, mede it his nerrensl business -- I mit:ht any hie sole businets for c time -- to get sub rcrintions from all of them, and writs , clam: t uniform success. The result sae that the 7irst Netienel tlenk turned in the largest subscription of any banking institu- tion t n the first loan. It -ran et this time that it become neceeetry to bred( do*n the prejudices of w work bankers ageinst borrowing money from the Reserve Rank. riuker cams early to Nations). an s m eting end, drewin,; me one side, stated thrt the First might went to borrow' '50,010,000 from us. they could heve it. One dry Mr. I told him that of course As I recr11, the securities cam over end the bank sac credited with the 550,0r)e,r,I00 the si H dr-y. I imagine it men the first time the riret National Rink hnd ever borroved in its history, snd Yr. Raker rho probably ae much surerised et Os, ease "-ith which the trans!' ction ram affected as other bankers were to see the rtrtectent that the loan bed been made. It rent a long way toward *bretking the 0 Sheet no. 6 '!r. Paine 3.1.19. ice" heceuee the statement published by national b!elko at th call of the Comptroller shortly thereafter shored total borrowings by the rirst Rational Nink of 65,000,000. (In this connection I believe it would be illuminuting if an account, in detail of the trensectiens or the rirst Kational Bank with the Federal Rererve B144 could be nubliehed -- It would oho- an estoniehing record or financial transactions, nrobably unprecedented in the country, end certainly no in proportion to the site of the Bank.) During all of th, summer end fell of 1917, when new Problems had to be faced, and upon s scale hitherto unknown, it 'eta necessary to htve frequent cern- mitt-e meetings at the Bank and at very ehort notice. I recall ,-ith some regrets that one day a sub-committee of the Liberty Loan Committee ear baked on very short notice to m-et at my office at 3:00 o'clock. Shortly before th m-atini:, a very severe thunder storm broke ovr the city, and I had not the slightest expectation thut the members of the committe:e epuld aosear. )n the contrary, ho' ever, Baker come into my offide nremptly at 3:00 o'clock, drinning vet, and re7.dy, as always, for Whatever nee- development rer in hand. And the other momb,,re came also: The situation rhich arose immediutely ufter our entrance into the ear, contained so many noesibilities of differences of o,linion and nelicy, that b group of independent, strong- minded, man, such LS constituted this committee, might °Frill/ have found it difficult to function. Such differences of opinion were in- evitable, end did develer, but it is no exaggeration to say that there never eras a tine when Yr. raker res not to subordinate his views to those or o majority, and principally these of younger men. There was never a time ehen his orn suggestions rare based upon other than the highest quality of patriotism and unon his desire to resist the Government and his country in carrying out its war progrem. He has made trine to 7ashineton for th,A purpose at the request of the 0 II at '7 . 3.1.19. 7_1r. Paine treasury Deportment and the aesorve Bank, and ho hoe reputedly stated to me, personelly, thet hie personnl services end the influence end fecilities of hia bank, and everything at this command, were st our despoeel to help make this Perk successful. The first step towards ineugureting the first Liberty Loen in New York was e luncheon given to fecretcry VeLdoo at the ilenkers Club. Ucedoo eet et my right, and Yr. Baker next to him. Secretary They spent the entire hour of the lencheon in disceesiee the Treveury Department's plena, trid i have heard both from Vr. Baker end from Secretary WcAdoo since then that that meeting laid the foundation for e mutuel confidenco which 1 believe has ateudily grown stronger during the rp.ut year and ens -hull, end resulted in the Secretary enter- taining a high regard for Yr. Bakerle views. Frequently, in meetings ith the i7ecretery, he has asked me to find out Whet "r. Raker thought about some matter under discussion. I sueeoce it is a fact that few men of his prominence and influence are es little knovn, generally, throughout the country as Yr. raker is. the exnlenetion lies in part in hie oen character. Probably This mor, vs I now feel, be eummed Up in three outetending qualities nature' to the man -- one is his simplicity, another his, modesty, and the third hie courage. I don't believe Beker over solicited a naeenheer interview, end I feel very sure that he he scrupulously avoided them ebenover possible. i have never heard him make a remnrk that could be considered boastful or egotistical, and, on the other hand, it would be the universal statement of all of his friends who know him intimately that few men in "all ::treet helve exhibited greeter courage in crises than he. sheet No. 8 . Paine ?.1.19. During all of these troublesome times, 1 have never reen him enter into o cot,- tention or betray temper. There mre few men in this country the uccumultte greet -wealth wir,o do The whole not muccumb to the Americen enirit of displey in 807,3 form or anot%er. record of /!r. 74ekar's life and of his ,dminietration of the First Nationel Bank hes been one of avnidence of disnley, extravagance, rest° rend publicity. with it ell, we 'ho know him well, have seen the ovidencen many times of stroni; human affection, Which would diEnrowe any thought that he belonged to that class of Fall Street men Who are so frequently cherrcterized en "cold-blooded" and "herd-hearted." Ho is en honest, modest, end simple man, whoee courage is founded on faith in hir country, on the honesty of human beinFs, and on his own judgment. of course you do not expect to incornorcte any Pert of the ebove in your book es it is written. Georre oen do thmt much better than I can. I have simply endeverod to write quite frrnlay of some few of my experiences with Mr. Baker, rni seer+ of my on estimates of him, gathered from these experiences, Which might be of wall() in trenering the story of a men's life, Which it certainly must be a nleesure to ynu, rs it would he to rnyone, to be elleeed to nrenare. Very truly yours, Albert /I. Paine, ;:gas, nrenxville, re York. BS.MSB A.B.P.- 2. Phoenix, Arizona, April 6, 1920. Mrs. John T. Pratt, o/o Re ublioa National Committee, 19 W. 44th St. Now York City. My (L:ar Ruth: This is a reply to your latter from the office juut received, as _I am working on somo mail. I must take opportunity to write you frankly with sore personal comments on the questionnaire on banking and currency. If you think worth while, dhow this letter to Et. Hays, but tell him that for obvious reaeone I would greatly prefer to have you and him hold it in confidence. The mowers to the questions whioh I oncloae explain themoelvea, but the following general statement is needed in further explanation. When the war started in 1914, all beilige ont nations our markets came here to buy foodstuffs and military supplies in unlimited quantities and be,land both our capacity to produce and their capacity to pay by the usual exchange of goods for goods and oervicoo forsorvioco. Thi resulted in various economic phenomina which may be which had atlases to ewrrized briefly as follows: (a) (b) We planted more land and increased our farm production. We bred ore draft and food animals and increased our iv:rds. (c) aterial required abroad for litary uze. um, oi money abroad. hidh we owed abroad. a billion dollars of gold, bank reserve° by that We enlarged our industrial plants, built new ones and greatly inoreaaed our prolpitt.Oh , S Yro. John T. Pratt "2* Now York City which unaoubtedly, and in my opinion, unavo*dably was bound_ to advanoa under oondltiane -ableb no eyatem of banking or of 000nomio* which has yet boon devised could be made t control. The above relates to the period between the oommenooment of the war in 1914 and our ontranoe into the war in 1517. Shootly after we ontored the war, and our onormrus finanoial operation@ commenced, a considerable number of the lei c;a.ng economists of the oollcoo professor, doctrinaire type, undertook to oriticiee the policy of the treasurg and of the federal reserve oyotom. One of the leaders in thle oritiosm was Profesoor Hallo:rider, whose nano appears uron the papers you sent me, and I suo.oeot that posoibly ho and game of the othero whop° names I dotioe may now be undertaking to direct thecae oiritioisme Evoaiont the present political party adkiniotrotion in ot:ioe for political* purposes. . Please do not allow youroelf to be mialed and possibly load into difficulties' by the oritioisms of theoriets who have had .absolutely no expetienoe in practioal affairs and who Ara, in fact, vary poorly informed of what actuo.11y transpired, cad therefore, rater naturally judge by the moults which they see rnther than by their on knowledge of all of the circumstances and difficulties which wore enoountered in a000mpliehing an almost aupuhuman task. Mr. Vondorlip and others hove cOorged that the federsa reserve syctem was subject to politioal domilvtion, be7J come of them thought they ocrc not como ou7. ghoul. be, and boarmse those rates were in a measure fixed to facilitate the treaoultAllplappo. This is a wholly oliotakon program is something as followo: idea and a oorreot vi Broadly speaking, there were three ways by which inflotton might be kept under control and prices kept down. (1) General economy in the.conomtion of goods or all kinds by all the people of the country, so that what was required for vAaitary puippeepe mi:ht be available out of ) (and this includes labor and'transpo what was saved by economy.. . (2) Curtnilment of borrowing; froh. banks in order to expand production by the imposition of hoavy raters for loans and a consequent tax upon production based upon bank oredit. (3) The payment of higher and more attractive rates by the goverment for war loans so that a wider q Mts. John T. Pratt ff3s New York City distribution to subocelbere would result without need for bank borrevinge in order to carry bonds. You certainly and I believe most of the people of the country are aware of the efforts made to impreso upon the American ,people the urgent needs of economy and the dioorganiting conoeluanoes reeult2,ng from higher prices, if they did not heed the warning. It may be that more could hate been done in this line, but the responsibility for thie if'lt wac a failure, rents neither with the federal reserve eyetem, nor with the aJmiaistration, but rather with the peculiarities of the American temperament and the habit° of a people who were accustomed to enjoy ne luxuries and eetravagencee t2-434 are inevitable in a nee and rich country. As to 2 and 3, you have frequentle: hoard me say thet to fix the responsibility for the policy of the treasury and the federal reserve system is like Ztxing the responsibility for breakiw.r a string upanA0040 two people are pulling, one at each end with all their might. Con2;roas was with the duty of authorizing war loans end delegated a most limited authority to tile secretary of the treasury to fix rateo and terms. The Congress simply heard his reoommendetions, which were arrived at after oonsultinr the reserve banks and other bankers. Asuuming, however, that the ecorearty of the treasury had aufficinet influence with Cengreso (which wee really not the case) to be regarded as himself Oetorminine the rates to , mere were then two bodies between whom this queetion o ret's lad to bo settled. On thojpne hand the treasury jeeertment, ::red tch the °thee hand the federal reserve system. The facts are that in every inetanoe they redo every effort to have their minds meet and to agree upon the wisest couree. In some instances I personally felt thet the rates were too low, but in all of those oases there were others of my associates and many other benkers outside of the reserve system who felt that they were either too high or in some oases were about right. As must always be true of such Letters, those policies as to rates were the result of disousoion, inquiry and a composition ef oonflictine views at t7e: moon oint at which it era.; believed that t7,e 4reetout possibilities of success existed. Looking -t the subject in eeneral terms, the rates et which the United States government borrowed money hee to be determined (upon the above assumption as to the secretry's powers) either by tho seoretery of the treasury, or by the federal reserve cystom. The secretary of the treasury could fix rates if Congress authorized him so much below our rates that his loans would be hopeless failures, or on the other ds beyond t reeort to der to pay s, such as omy upon e value of many in hardships, n those reof bank e d ted e but t n , in dict. ugust at had s had s lire. John T. Pratt Ilea: York City hand we could aavanoe our rates so much above those atavhioh he felt that he could borrow money that we yould cause his loans to fail. Looking at the matter oeneibly and with due re*ard to contemporaneoue conditions, what could be done under the circumstances that was not done? These men who criticised wht wan done have from time to time come forward with soae of the moot unpraotical and ridiculmaapuggeotione that I have ever heard. (heir great ory hao al& along been *higher intarget rates and yet any sensible7Peroon runt know th,tt a nation which -encounters a demand for goods beyond its capacity Lire. John T. Pratt 115e New York City jutified, it in litle indeed t-7' uee for a political campaign, when there in so muoh good miterial lying abut loose if pn#1, 4ante to take a °lam at the administration of the war. Lest you thin-:. I mieunderet.7md the questionnaire, I should cry tivt leant I hope that it will be used when comr,leatt, in,prep-rinr! a platform for the Republican party r: ±-they an in oonductilig a oampaign for the election of a wish directly or Republican preeid.ont. Obviously, I do indirectly to pl,:!Ce myself in a position of oritiAsing my war associates or the pro3ram wbioh we together agreed upon and orrried out, but az to the federal reverie sys,fwand the cot unaer which it i created, there are many imfortcnt Constructive and boneficiai changes which orn be made by Congress if taken up in the right spirit, wholly freed of partisan or politioR1 objects. I wish you would think about this a little bit, if you aro all interested in thin brcnch of the pock, and ask Er. Hays if I could not be given opportunity, 'either 6.urinL; my absence, or upon my return, to go into thin thoroughly with him and his associates. You must not think that egotism prompts me to write that no one who was concerned in there matters during the wp.r period hs.d nuoh an opportunity to see both _sides of the picture as I did. My work was both in the tro2ury in the Ref:larva bank an in the war loan organizations, and I think no one in the country had the opportunities which I had during my tripe abroad in 1916 and 1919 to get an underetanding of the So please e:Lrerionoec, diffioultiss and views of our ailiew. to 'vehemont, regard this ouggemtion, which is possibly a little that there is little to be gained by a orilpioism of the way in financed and a very good chance that It will which our wox react won these who indulged in it. Your letter makes me regret that I hrwe no ppportunity and had I the opportunity, no right to take part in these matters, but good lubh to you :-);nct your orzlmiltion and partioularly to you fvld Mr. Hays. Rathfully yours, Pheenix, Ariz na, April 6, 1920. powers. It is manifestly abiird to claim that governLent borrowing and the rates of interest which the government paid, and which the Reserve Banks cLarged was as great ar. influence in advancing prices as was this wholly unrestricted compeiation for goods at any price for inredi-te delivery by both the governments and the private citizens of this country and of Europe. It would be more accurate to say that thc advance of prices caused by this c.lepatitive buying neceesitated larger 'issues of currency and a greater volume of bank credit. (3) I firmly believe that much lase expansiori of both credit and currency w uld have occurred during the war if a more vigor.* and arbitrary control of waste, extravagance and oonsuniption of, geode and labor had been undertaken by all of the belligerent governments. But here we encountered a difficulty. Had such stern measures been undertaken, the war might have beoonie unepular, a moral reection hav,; occurred and the war been lost because of the antagonism of the civil population. Honesty rely here require the ad lesion th:.t war always naceealtates a Choice of evils, and It vay be that expaneion viae the lesser evil. Undoubtedly. It met be borne in mind, however, ,ne owe coneideretiono -e'ich governed the fixing of interest rates on goverment loans before the armistice, . continued to operate feE L1,..ny menthe after t: _e areistico wac signed, and to some extaht after the fifth victory liOcrty loan was floated. The moat difficult period of the whole war in a finanoilik sense wc),a between November 1916 and July 1919. Without desirrig to be dogmatic, my best judgment at the time and wince was that the tone) of the fifth loan were exactly right, but that the troasury-and reserve bank rates should have adv, need more sharply ocreetime during the sueL:er cf 1919. _ 5. Probably to some extent. The reb-und from war control to complete freedom in financial enterprises W43 bound to occur in this country to a greater extent even t.cal in Europe where it was pron-unced. With this whole subject I had a most intimate contact during the entire war period through being chairmen of the co called Money CorLitteo. Hy boat judgment now and then fevered somewhat higher reuervo bank rates, but at no time did I believe that hiher rates within the limits of prudence could have been F:cre than a alight influence, u; on spoculatile and financial enterprise. Very few people are aware of the arbitrary control ehiel was exercised in this matter an the serious, pain? taking efforts which. were taken to curb the developrent. The answer to 'the question can be postively made that higher rates would have helped but would not alone have been effective. .3. AP This influence in turn will be felt by the what they borrow. bank customer who in consequence will be chorged a hirlier rate. In the meantime, of course,-the treosury must .pay constantly In exorcising this kind of higher rates for whyt it borrows. pressure, the grortest a.re must be used to avoid autricht The best policy is.probbly a tLoz.aughlgietex4s ponic and breakdown. high rate level, but not so high as to create alarmlp....ined with a thorough going education of our bankers. All of this is being done in some sections bettor than others, but on the whole with groat intelligence and vigor. I believe that the amount saved by the government 94 beteen the rates which it l)aid for iaous anti any higher rate which 440 government might have paid for its loans was more than offset by advances in the prices of goods and services which the government had to purchase during the war, but I do not believe that the general rise in the price level can fairly be attributed simply to the failure of the government to pay higher rates and the reserve bent zs to charge higher It is in fact hard for me to believe that any student rates. of this subject can honestly attribute the advance in prices to the failure cif they overntLent to pay a quoxter of ono' per cent or a half of ono -"per cent, or even two per cent 'more for its loans than it did pay. Priests advanced rrinciphlly becase tlie demand for goods exceeded the production, and the Any other 1,11dinl for goods could not be 'kept within control. claim overlooks the fnots and is based uoon asstrtion text books. theories I am familar with Professor Fieherlo p416n, have road 10. hI publications and talked and corresponded ,pit him on the The ploz is too revolutionary t' be undertaken in subject. the preoent disorderd, econoric conditions throughoUt the world and certainly to uncertain in Ito effect for us to be justified in attempting the experiment alone In the face of nay very well increase in ly other the disorder countries in financial and currency condit one. 11. The advonceetn discou* rates has cueed some'do- °Ana in government s utitice ab was inetitable and antiotdpatcd, but I have little knowledge of what has happened to irresponsible promotions nor do I believe that these were greatly influenced in their success or failure one way or the other by a differenoe of one per cent more or lose in the They were brought rates of discount of the reserve banks. on more ac a con,;equonce of high prices.of commodities rather Durihr; tae period of floatation t:i;:x the low mice of credit. o2 fosse securities, credit for ouch purposes cost more to the borrower for a longer and more aontinuoue period than' during any tine within the pact twenty $eara cr longer. - the n own exrerience with the reserve system suggests for various changes in thu act, but few of which are g6. 6. The great rargin of profit ulich still exists in rany llnes of business and will continue to do so r_s long ra extravacance continues. The above is sent in confitienoe for the personal use of Mro. Pratt and Mr. Mays. 43 6 PM LEAVE R. FOURTEENTH THE ABOUT livIEST ASKED NOT ADVISE HOWEVER WELL. STAYING OF INSTEAD MISTAKE GREAT YOU BEFORE A S I . GO 71) AR ECT. EXP WORTHLESG GETTING ARE UNCERTAINTIES ITS WITH I IT INK TH . STILL IRIS A QUESTIONN LIVING INTERNATIONAL TO. ANSWER z_ .PHOENIX SEND BANK YOU KNOW' YOU YOU S I FOR ',HERE TRIP THIS. TAKE TO WELL SO I OF COST1 COULD FEEL HIGH AND. IF FINE BE GLAD YOU RELATIONS WOULD T I NATL IX PHOEN CARE. G ON I NY NEWYORK Sn IN Aloi X BEN FY NL API 1920 65 A216S ARIZONA PHOENIX, AVENUE. CENTRAL NORTH 20-22 AT RECEIVED VICEPRESIDENT check. the after appearing symbol the by indicated is character its wise Other- message. aday Is wordsithis or number check the after appears symba6 three Meat of none If Letter Night I. N Message Night Nita ATKINS. F E i.Ni.aic.a.rir CARLTON, NEWCOMB W. GEORGE check. the after appearing symbol the by indicated is character its wise Other- message. day a is vordsittus at thurnbei check the after TEL I D. N. SERVICE OF CLASS omboia three mirea Jr .6 . Letter Night I N Massage Night Nite UNION WESTERN Message Day SYMBOL Ittir AM Letter Day Blue Blue h3 UNION 47s7NAESTE W Letter Day Message Day SERVICE Of SYMBOL 7S ASS i -1r WESTER; . UNION TEL .4 " AM CLASS OF SERVICE SYMBOL Day Message Day Letter Blue Night Message Nile CLASS OF SERVICE SYMBOL Day Message Day Letter s) thin Ise day message. OtherIts character Is Indicated by the NEWCOMIS CARLTON. PRESIDENT GEORGE W. E. ATKINS. FIRST VICE-PRESIDENT Blue Night Message WESTERN UNION NL Night Letter If none of these three symbols ears after the check number of I symbol appearing after the cheek. . Nita NL If none of those throe symbols appears after the check number of Night Letter words) this Is aday message. Otherwise Its character is Indicated bythe symbol appearing after the check. RECEIVED AT PINE & MONTGOMERY STS., SAN FRANCISCO. ALWAYS OPEN. B230NY 46 El NEWYORi< NY 357P i4 BENJAMIN STRONG 796 CR FEDERAL RESERVE BANK SANFRANC I SCO CALIF WI LL YOU LET ME SHOW TYPEWRITTEN LET-ER AND ANSWERS TO BANKING AND CURRENCY OUEST I 3NAI RE TO OGDEN MILLS THE CHIEF 'THINKS PT VERY IMPORTANT T H I S I S DONE AS HE FEELS YOUR POINT OF VIEW 'THE MOST VALUABLE SEE THAT YOU ARE PROTECTED I WILT IN THE MATTER RUTH. LASS OF SERVICE DESIRED WESTE02sINA UNION TEL - AM .N4 Fast Day IIflessago Day Letter WESTERNUNION Night Message 11 Night Letter Patrons shoula mark an X oppor the class of service desired: ERWISE THE TELEGRAM WILL BE TRANSMITTED AS A FAST DAY MESSAGE. I Receiver's No. Check Time Filed GEORGE W. E. ATKINS, FIRST VICE -PRESIDENT NEWCOMB CARLTON, PRESIDENT Send the following telegram, subject to the terms on hack hereof, which are hereby agreed to an Francisco, California, A7ri1 14, 1920 Mrs. Jno. T. Pratt, c/o Republican National Committee, 19 West 44th Street, Now York City Telegram just received It will be 911 right to show answers to Ogden Mills in confir_!ence for his personal information if you think he Tould regard my vievs of r:ny Irlue stop some criticiJm of ..,-reLury Memorandum and letter contained some members of your organi7ction and I had only expected.lt to be used by yourlf" ?Iv:1 tJe c17isf privately I shodL rely on your judgwent aeneral Wood helpful . nd hOr-03 ylu Wiest regards BEWAMIA STRONG 'irri this ;nd Letter to stop V ALL TELEGRAMS TAKEN BY THiS COMPANY ARE SUBJECT TO THE FOLLOWING TERMS: To guard against mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to the originating office for comparison. For this one-half the unrepeated telegram rate is charged in addition. Urdebf otherwise indicated on its face, THIS IS AN UNREPEATED TELEGRAM AND PAID FOR AS SUCH, in consideration whereof it is agreed between the sender of the telegram and this Company as follows: 1. The Company shall out be liable for mistakes or delays in the transmission or delivery, or for non-delivery, of any UNREPEATED telegram, beyond the amount received for sending the same; nor for mistakes or delays in the transmission or aeuvec;:, or for non-delivery, of any REPEATED telegram, beyond fifty times the sum received for sending the same, unless specially valued; nor in any case for delays arising .trom unit% oidable interruption in the working of its lines; nor for errors in cipher or obscure telegrams. 2. In any event the Company shall not be liable for damages for any mistakes or delays it, the transmission or delivery, or for the non-delivery, of this telegram, vgarer caused by the negligence of its servants or otherwise, beyond the sum of FIFTY DOLLARS, at WiliCil amount this telegram is hereby valued, unless a greater value is st ir! in writing hereon at the time the telegram is offered to the Company for transmission, and an additionat sum paid or agreed to be paid based on such value equal to one -tenth of one per cent. thereof. 3. The Company is hereby made the agent of the sender, without liability, to forward this telegram over the lines of any other Company when necessary to reach its destination. 4. Telegrams will be delivered free within one-half mile of the Company's office in towns of 5,000 population or less, and within one mile of such office it_ other cities or towns. Beyond these limits the Company does not undertake to make delivery, but wilt, without liability, at the sender's request, as his agent and at his expense, endeavor to contract for him for such delivery at a reasonable price. 5. No responsibility attaches to this Company concerning telegrams until the same are accepted at one of its transmitting offices; and if a telegram is sent to such office by one of the Company's mcssengers, he acts for that purpose as the agent of the sender. 6. The Company mil n0r 1,0 liable for larnages or statutory penalties in any case where the claim is not presented in writing within sixty days after the telegram is filed with the Comna,r fr,r 7. Special It re., governing I.e transmissi ,tf me...vrger, under the classes of messages enumerated below shall apply to messages in each of such respective classes in addition to all the foregoing 8. No employee of the Company is aulhorwed to easy the lorecannilt THE WESTERN UNION TELEGRAPH COMPANY INCORPORATED NEWCOMB CARLTON, PRESIDENT CLASSES CF SERVICE FAST DAY MESSAGES A full-rate expedited service. LIGHT tviEssAcr:3 Accepted up to 2.CO A.M. at reduced rates to be sent during the night rid delivered not earlier than the morning of the ensuing business day. PAY LETTERS A deferred day service at rates lower than the standard day mesvnge rates as follows: One and one-half times the standard Night I.-tter rate for the transmission of 50 words or les^ and one-fifth of the initial rate for each additional 10 words or less. SPECIAL TERMS APPLYING TO DAY LETTERS: In further consideration of the reduced rate for this special "Day Letter" service, the following special terms in addition to those enu- merated above are hereby agreed to: A. Day Letters may be forwarded by the Telegraph Company as a deferred service and the transmission and delivery of such Day Letters is, in all respects, subordinate to the priority of transmission and delivery of regular telegrams. B. Day Letters shall be written in plain English. Cone language is not permissible. c. This Day Letter may be delivered by the Telegraph Company by telephoning the same to the addressee, and such delivery shall be a complete discharge of the obligation of the Telegraph Company to deliver. This Day Letter is received subject to the express understanding and agreement that the Company does not undertake that a Day D. Letter shall he delivered on the day of its date absolutely and at all events;; but Ihat the Compariy's obligation in this respect is subject to the condition that there shall remain sufficient, time for the transmission and delivery of such Day Letter on the day of its date during regular office hours, subject to the priority of the transmission of regular telegrams under the conditions named above. No employee of the Company 1.3 authorized to vary the foregoing. MIGHT LETTERS Accepted up to 2.00 A.M. for delivery on the mcrning of the ensuing business clay, at rates still lower than standard night message rates, as follows: The standard day rate for 10 words shall be charged for the transmission of 50 words or less, and one-fifth of such standard day rate for 10 words shall be charged for each additional 10 words or less. SPECIAL TERMS APPLYING TO NIGHT LETTERS: In further consideration of the reduced rate for this special "Night Letter" service, the following special terms in addition to those enumerated above are hereby agreed to: Night Letters may at the option of the Telegraph Company A. be mailed at destination to the addressees, and the Company shall be deemed to have discharged its obligation in such cases with respect to delivery by mailing such Night Letters at destination, postage prepaid. B. Night Letters shall be written in plain English. Code language is not permissible. No employee of the Company is authorized to vary the foregoing. October 30, 1925 Deli- Mr. julliv,n: he iLiabci you IL Lhe Annex., bat it thoee elastic affair:, ahere no incorIvenience radultea Lit Ldoouse of your not coming and not dendine) vorc. I have h a 60.01C E,A;..uriCaCC pith folic of your profebdion heretofore, ,L1,1 rm;o how uncei'toia they have to bd uL tildes about _d.5,muntd, and so no h,trm was done. I only sorry you n1 1-oa Imo meeting. Sincerely yours;, M.,.-Ac Sullivan, Esq., 1701 H Street, 4itshin6Lon, D. C. (Dictated, but signed for Mr. Strong) d very int-:reLt-